Let there be light

Muiz Banire > The Sun Articles  > Let there be light

Let there be light

So says the Lord. This will probably become a truism in Nigeria in terms of stable electricity. It is increasingly becoming a reality in the realisation of steady power supply in the country as all efforts appear to be a mirage. At least, for the last three generations in Nigeria, having stable power supply has remained a challenge. I recall while I was growing up, each time my late father returned from work, the first question was usually, ‘is there light?’ By the time I grew up and started work also, I asked my children the same question once I returned home. Now our children are beginning to ask their children the same question. Even some of our grandchildren are still used to the chant of the last three decades “Up Nepa!” whenever power is restored.

When would this cycle end? This is the enquiry we intend to respond to in this piece. Finding a solution to this scourge is now so imperative and urgent, in view of the pandemic ravaging the entire world. But before going into the merit of this issue, let me digress by saying that I recently read a news report of an electricity company employee who was battered beyond recognition by irate consumers when he went to distribute electricity bills in Ogun State during this lockdown. The picture of the man, covered in his own blood, was not pleasurable to the eyes. Second, I saw a video skit trending online with a woman employee of an electricity company appealing passionately in Yoruba language to electricity consumers in a rural area to kindly pay up their electricity bills as the distribution company she worked for also paid to get light to distribute. I reflected on whether the two practices of distributing bills manually and having to appeal to consumers to pay for their consumptions reflect us as humans occupying the same earthly space with other countries.

If the Discos had made meters available to all homes in a pay-as-you-go system, no one would need to chase a consumer to pay for his consumption. No telephone service provider needs to appeal to you to buy airtime save for their occasional advertisements necessitated by competition in the industry and no one is required to chase anyone for payment notwithstanding the unsatisfactory state of their services and the number of drop calls you may have in a five-minute conversation.

Back to the crux of this discourse. Everyone knows that the importance of electricity in modern existence is beyond description. Beyond the inclement and harsh weather in the country, nothing progressive can happen without electricity, be it infrastructural development, security, employment, industrialisation, education, public health, etc. We can continue to replicate this to no end. The fact is, particularly in our new world, power supply is the soul of survival. I am sure that my readers would be wondering, beyond being a consumer of electricity, how does this concern me or when did I become an expert on the subject so as to be propounding solution to the problem? My interest in the subject stems from my engagement and interactions with some of the actors in the industry, particularly in my capacity as the chairman of my community residents’ association, in the quest for energy provision in the community.

At present, apart from inadequate power generation for the country, there is the challenge of transmission, which is the neck of the system, and the eventual power distribution to the tenements. Just before I am crucified by the bourgeois, let me sound a note of warning that prognosis proffered here is not meant to be oppressive of any particular class but just a genuine product of my thoughts. To this end, my diagnosis of the challenge reveals the cause as nothing but inappropriate pricing of electricity in the country.

The fact is that the cost of generation, transmission and distribution of a unit of electricity in Nigeria today far outweighs the consumer price. It is in realisation of this gap that the Federal Government, at the point of privatisation of the distribution companies (Discos), undertook to always subsidise the price per unit of electricity consumed by households. It is, however, no news today that the Federal Government has so far performed poorly in this regard. Little wonder, therefore, that the Discos continue to groan in debt, resulting in incapacity to ensure adequate and steady power supply in the country. Consequently, electricity supply chain is not and will remain not a lucrative business under the present scenario. It is really a bad business for any serious and genuine investor.

The rumor is that those who, in the first place, ventured into the business under the privatisation drive did so not because of the viability but against the assets of the companies, particularly real estate, and the subsidy promised. However, when the reality of irregular subsidy payment dawned on them, they started crashing, thereby impairing the provision of power supply. There is a saying in my dialect, akara ba tu si epo, which in the ghetto rendition means, ‘katakata come burst.’ Since that time, supply has not measured up in the face of increasing demand and the system has been going prostrate. It is in the midst of this darkness that my community embarked on searching for alternatives, ranging from solar panel, modular power generation, captive power and, eventually, premium service. The latter is based on the recognized principle in the Nigerian Electricity Regulatory Commission law of ‘willing seller, willing buyer’. This implies the payment of appropriate price for unit of electricity beyond the regulated fee by the regulator in return for regular supply of power. In my community, the undertaking by the Ikeja Disco is for minimum supply of not less than 20 hours a day, barring any force majeure. With this undertaking, the Ikeja distribution company embarked on aggressive infrastructural upgrade in the community and commenced supply. Since the take-off of this arrangement, power supply has been impressively stable and response to complaints became incredibly prompt. This model is already replicated successfully in a whole lot of communities now under the Ikeja Disco. This is a testimony to the fact that, with appropriate pricing, electricity can be made stable in the country. The truth remains that meeting this objective requires colossal investment in infrastructure, which is largely beyond the reach of most local investors. Foreign investors, with the required capacity are, however, unwilling to invest due to the inappropriate pricing in the country. Thus, to attract the needed investments in this area, appropriate pricing is the key.

I can anticipate the next issue of agitation to be the question of affordability by most Nigerians whose income is less than $2 per day. This is where the concept of cross-subsidisation comes in. To date, different tariff structures operate within the system, and all that is needed is to subsidise the bills of the vulnerable and the poor, not so much by government, but by residents of the privileged areas in the country. This is not a strange proposition, as it is a universal practice, particularly on issues of taxation, land use charge and other fees. For a clearer picture, anyone who purchases land in Ikoyi, Lagos, knows he would pay probably five times higher to procure governor’s consent, which is per square billing, compared to someone who acquires land in Ikotun or Aboru. And the two of them are ‘happy’ residents of Lagos State. No one has thought this unduly discriminatory and the same could be applied to electricity billing, based on location. We find discriminatory regime in these areas all over the world.

Thus, those areas pay higher price to accommodate the subsidy for the poor areas. I am sure it is divinely commanded and righteous to do so. The adjunct to this is for the various state governments to generate the subsidy from the prime properties under the land use charge or tenement rates, as the case may be. All that is required is to up percentage payable by the prime properties to accommodate the subsidy to cover the residents of the vulnerable and the poor. This will then be remitted to the appropriate discos in the state. Certainly, at the initial stage, the price per unit under this arrangement might appear exorbitant, but with the attraction of more investors and existence of alternatives, the price per unit will gradually start to crash, until such a time that subsidy itself will become unnecessary.

The experience in the telecommunication industry is apt in this regard. The eventual competition will ensure that the prices become affordable to all and consumers will be treated with choices as obtainable in other climes. The multiplier effects of the investments in the area include creation of multiple jobs, enhancement of security and rapid economic and industrial growth. I am sure we all know that power is a catalyst to growth. This, in my humble view, is the way to go in the provision of steady electricity in the country. Should we refuse, neglect and or fail to adopt this approach, then our dream of steady electricity supply in Nigeria might be at the doorstep of divine intervention and remain a strong prayer point at crusades.

Let me conclude by categorically stating that, should I fail to persuade you, regard my thoughts as that of a meddlesome interloper and I will appreciate a more pragmatic solution from anyone so far as it fulfills the divine directive: Let there be light.

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